Greggs (LON: GRG) moved higher in early Thursday trading after the company posted a fourth-quarter trading update revealing demand remains robust.
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The food-on-the-go retailer revealed sales for FY22 were £1.51 billion, rising 23% compared to 2021, while like-for-like sales for the fourth quarter increased 18.2%. Like-for-like sales for FY22 rose 17.8%.
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The company told investors in its release that despite the impact of adverse weather and strikes towards the end of the year, its like-for-like sales reflected a favourable trading pattern heading into the Christmas period following softer trading conditions in the same quarter last year as a result of the disruption caused by the omicron variant of coronavirus.
There was also strong growth in Greggs' digital and early evening sales, with the company seeing strong growth in the use of the Greggs App as consumers increasingly focus on value.
“Our teams did a magnificent job serving customers and managing the growing demand for Greggs products as we expand our shop estate and offer greater availability through digital channels and longer trading hours, whilst continuing to extend our menu to offer more choice,” said Roisin Currie, Chief Executive of Greggs.
“We enter 2023 in a strong financial position that will enable us to invest in shops and supply chain capacity to bring Greggs to even more customers across the UK.”
The company added that it has a strong cash position of £191 million to support investment in its growth plans which include increasing both its shop estate and supply chain capacity in the year ahead. It expects to open around 150 new stores again in 2023.
Greggs maintained its guidance but warned that it continues to see material cost inflation in the year ahead, although its value offering “remains attractive in the food-on-the-go market,” and the company remains confident in 2023.
“While market conditions in 2023 will remain challenging, our value-for-money offer of freshly-prepared food and drink is highly relevant as consumers look to manage their budgets without compromising on quality and taste,” Currie added.
At the time of writing, Greggs shares are up around 0.5%.
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.